Nebraska DEE

Focus On Water

Drinking Water State Revolving Loan Fund

The Nebraska Drinking Water State Revolving Loan Fund (DWSRF) program provides low interest loans and loan forgiveness to owners of public drinking water systems. The loan principal repayments go into new loans and interest earnings on the Fund is used 1) to pay off the state match bond issues and 2) to make new loans.

Helping Communities Address Funding Needs

The Drinking Water State Revolving Fund (DWSRF) program was authorized by the 1996 Amendments to the Federal Safe Drinking Water Act. The Environmental Protection Agency makes the capitalization grants to states to help establish their DWSRF programs. Nebraska’s DWSRF program provides loans to eligible public water supply systems for the construction of water works, and for land acquisition from willing sellers for source water protection. Funds can be used to plan, design and construct drinking water facilities.

The NDEE, and Nebraska Investment Finance Authority (NIFA) jointly administer certain provisions of the Drinking Water Revolving Fund Act. NIFA is authorized to issue revenue bonds to provide funds for NDEE to loan to public water supply systems within the state.

Nebraska’s SRF interest rate system is defined in an annual Intended Use Plan. Current loan rates can be obtained from NDEE. Additional interest rate reductions are available for early payback, and to economically disadvantaged communities.

How Can Your Community Receive a Drinking Water SRF Loan?

To receive a DWSRF loan, communities need to comply with some basic requirements:

Projects must be eligible for funding under the DWSRF program, and be placed on the annual Intended Use Plan priority list.
Communities must comply with planning requirements and have an engineer’s report prepared by a professional engineer.
An environmental review and public hearing must be conducted, with certain exceptions.
Communities must sign a loan contract and dedicate a funding source for repayment. The maximum term for a loan is 20 years, unless the community is economically disadvantaged, in which case it qualifies for up to a 30-year term.
Loans must be repaid with interest charged at th rate that a community qualifies for under the interest rate system in the Intended Use Plan.

How to Get Started

To begin planning a drinking water project, the first step is to contact the DWSRF program staff at 402-471-4200. Staff can help guide you through the planning process, and identify alternative financing sources. All publicly-owned borrowers are encouraged to submit a joint pre-application for state and/or federal assistance.

The basic steps include:

Complete and submit the biennial (every other year) Combined Clean Water and Drinking Water SRF Needs Survey to the state. (This survey is mailed to communities every fall, and is due by December 31^st. The state uses this information to develop an Intended Use Plan, which is a detailed prioritization of projects.)
Submit a joint water/wastewater pre-application for state and/or federal assistance to NDEE (contact information listed at the bottom of this page.)
Hire a professional engineer registered in Nebraska.
Develop an engineering report showing that present and future conditions and environmental impacts have been reviewed, alternative design approaches have been identified and assessed, and the best affordable alternative has been selected.
Identify possible alternative financing sources. You should explore how the DWSRF program and other state, federal and local sources can be combined to provide the best financing approach.
Develop community support for the proposed water works improvements. Managers should communicate the need for new facilities to residents, identify how the selected approach is well-suited for the community, and implement a user fee system to cover facility costs.